The Chopping Block: Bitget's 387 Million Dollar Hack, Kalshi's Cooked Perps Volume, and Agentic Bank Runs

Haseeb Qureshi (0:00)

Oh, North Korea is in here, we're gonna shut this off. 387 million.

Robert Leshner (0:04)

Tarun is the 10th most famous Delaware resident.

Haseeb Qureshi (0:07)

Consensys is a big boy.

Robert Leshner (0:09)

I never swear on the chopping block. Hey, this looks cooked.

Haseeb Qureshi (0:11)

Agentic Bank runs.

Tarun Chitra (0:13)

Your estate is paying for dialogue. Homo economicus is everyone's...

Haseeb Qureshi (0:16)

Back, baby.

Robert Leshner (0:17)

Not a dividend.

Tarun Chitra (0:18)

It's a tale of two clans.

Haseeb Qureshi (0:19)

Now, your losses are on someone else's balance sheet.

Tarun Chitra (0:22)

Generally speaking, airdrops are kind of pointless anyways.

Haseeb Qureshi (0:25)

I'm into trading firms who are very involved.

Tarun Chitra (0:28)

I like that eat of the ultimate.

Robert Leshner (0:30)

DeFi protocol is part of the antidote to this problem.

Haseeb Qureshi (0:33)

Hello, everybody. Welcome to Chopping Block. Every couple of weeks, four of us get together and give the industry insider's perspective on the crypto topics of the day. Quick intros. First, you got Tarun, the gigabrain and Grand Puba of Gauntlet. Yo.

Then we've got Robert, Crypto Connoisseur and Tsar of Superstate.

Robert Leshner (0:48)

Good morning, everybody.

Haseeb Qureshi (0:50)

I am Sieve, the head hype man at Dragonfly. We're early stage investors in crypto, but I want to caveat that nothing we say here is investment advice, legal advice, or even life advice. Please see Chopping Block.xyz for more disclosures.

So we are together here in Amsterdam in studio. And we usually try to make sure we have four people in the show, but we have this very interesting, futuristic self-serve podcast.

Robert Leshner (1:11)

It's an automated robot booth.

Haseeb Qureshi (1:13)

Yeah, it's quite awesome.

Tarun Chitra (1:15)

This is how AI is going to get all our information from us. They're going to make the human walk into the pod for talking.

Haseeb Qureshi (1:21)

Yeah, that's smart. Well, but it's also like, look, I mean, the jobs have already been displaced. Here we are and we get to talk to, well, we did talk to one human, but technically we wouldn't have to talk to a human.

Robert Leshner (1:30)

It could have been a humanoid robot, like functionally, like one day.

Haseeb Qureshi (1:33)

That one day, one day. And so we're here in Amsterdam. It's been an interesting week in crypto markets and it's unfortunately been a week of multiple hacks. So, let's talk about the big one. Bitget, in which, you know, Kavya, we are investors. Bitget is one of the biggest exchanges in the world, top five in any given day with respect to derivatives volumes.

They got hacked about $387 million that was hacked from Bitget, very likely attributable to the Lazarus Group, which is a part of North Korea.

Bitget, it seems to have mostly affected their hot wallets slash warm wallets. There was some kind of infrastructure-linked hack. The details aren't fully clear yet, but they stole a bunch of different assets out of these hot wallets. Now, Bitget, thankfully, they are a very profitable company. They're quite solvent. They had $460 million set aside in a insurance fund slash user protection fund, so that was enough to fully pay out all the claims. They've already begun withdrawals, and so people are starting to get their money out.

So thankfully, it's not a contagion. Everything is okay. The amount of money is a lot less than the amount of profit they made last year, so they're in good shape and the industry is solid. However, it's brought up a lot of conversations about money laundering, and specifically because the DPRK, which of course took control of these funds and then had to try to get them out, used a bunch of different strategies to try to move these assets into assets that couldn't be frozen. So the first thing they did, of course, was move the stable coins out of stables and tried to move everything they could onto Ethereum, such that it couldn't be interdicted by freezes and so on. But the other thing they did is they ended up using THORChain.

Robert Leshner (3:16)

Not the first time they have used THORChain.

Haseeb Qureshi (3:17)

Correct. THORChain appears prominently in many of these hacks. And THORChain, of course, is a cross-chain spot trading protocol. And it allows you to trade, let's say, you're sitting in a protocol like, for example, Arbitrum, that Arbitrum has been known to freeze itself when their assets hacked. I think Tay, friend of the show, she made the joke that the DPRK moved faster to get out of Arbitrum than they did to get out of USDC.

Because USDC...

Robert Leshner (3:44)